A brief review of current premiums on PMs.
jmski52
Posts: 22,850 ✭✭✭✭✭
I started thinking about another bullion purchase recently, so I started looking at premiums today to get my bearings. Wow, the premiums are quite steep, which could partly be because of the price drop I suppose. I only looked at Apmex because I'm not yet comparison shopping but I was surprised.
1/4 oz AGE, random date, single coin - 10%
1/4 oz AGE, Mint Direct Roll, 2016 - 12%
1/2 oz AGE, random date, single coin - 7%
1/2 oz AGE, Mint Direct Roll, 2016 - 8%
$100 Face 90% Dimes or Quarters - 14%
1 oz. Silver Maples, random date - 12%
500 oz Green Monster Box, ASEs - 15%
5 oz ATB, random date, single coin - 18%
5 oz ATB, Mint Direct Roll - 19%
Very interesting. There's not only high premiums all across the board, but silver seems to be much more sought-after than gold at this time. Is there a run on silver, in spite of - or because of the cratering in price?
I knew it would happen.
Comments
I think premium are high because metals got crushed yesterday. Check premiums in a week to 10 days.
Knowledge is the enemy of fear
18% premium on the 5 oz. ? Yikes Another reason that those are the worst form of silver to stack.
Yep... high premiums seem to have put a damper on PM's ...even though spot is down....this will hold to avert losses. Cheers, RickO
APMEX also tends to have a bit higher premiums despite being an authorized purchaser
I can't personally say I've bought from all sellers listed
And it is a good idea but with too few comparison sites
Here is a quick view of a few sellers of major gold & silver products
https://comparesilverprices.com/silver-gold-coins-bars/
lower prices = higher premiums
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
rumor on the street is that the US Mint has suspended further sales of 2016 bullion ASEs to its authorized purchasers.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
An attempt to force a run on 2016s to bail out the APs ahead of the 2017 production.
Knowledge is the enemy of fear
More likely a cease in production to gear up and start striking the 2017's, something they usually do near the end of the year. The fact that their are none left on the shelf to carry them to the end of the year should clue you in to demand.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
In the past, I've had an AP complain that they have to buy a certain amount of the prior year when buying the new year's run.
no comment of suspended sales. unknown reason for it.
Why?
Maybe the mint should offer leftovers to the public, first come first served for the same price that APs pay.
sellers trying to cut their losses. When prices are down odds are up that bought at a higher "spot" price. Your large bullion dealers are selling what they recently purchased (at higher prices), they don't sit on the metal.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
The mint should eliminate all AP and sell everything directly to the public. Aren't the APs just another social program? Why not let the miners send their silver to the mint, the mint produces the ASEs for the miners (paying for costs), then the miners sell their silver to the public.
Knowledge is the enemy of fear
What? No middle men?
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
The mint uses APs probably for the same reason that Ford and GM use a dealer network. And many large manufacturers use a dealer distribution system. Not worth the hassle to mess with millions of puny orders. I wonder how many takers the mint would get for leftover ASEs if the minimum order was 2 or more monster boxes.
The question was rhetorical.
That's why they should send the silver back to the miners from where it came. Or impose a 10 coin minimum. If people can't afford $200 then they shouldn't be buying it in first place .
Knowledge is the enemy of fear
I see the one AP that publishes their sell prices has raised their 2016 ASE sell price about 46 cents with no discount for larger buys. So it's not just dealers who are holding higher priced inventory that raise prices.
IMO, the mint/Government has no business being a contractor for/to private businesses esp. when it involves minting money. YMMV.
Are they not contractors for the APs now?
Let's do away with all mint products anyway. Less than 1% of population cares about this stuff anyway. Let them just make coins for circulation.
Knowledge is the enemy of fear
NO.
The government ( mint/treasury) is not in the business of making money ... They're in the business of taking it. And they're the same ones who are allowed to gouge us for it.
Nov. 12 Data:
_1/4 oz AGE, random date, single coin - 10%
1/4 oz AGE, Mint Direct Roll, 2016 - 12%
1/2 oz AGE, random date, single coin - 7%
1/2 oz AGE, Mint Direct Roll, 2016 - 8%
$100 Face 90% Dimes or Quarters - 14%
1 oz. Silver Maples, random date - 12%
500 oz Green Monster Box, ASEs - 15%
5 oz ATB, random date, single coin - 18%
5 oz ATB, Mint Direct Roll - 19%_
UPDATE - Dec. 12 Data:
1/4 oz AGE, random date, single coin - 10.8%
1/4 oz AGE, Mint Direct Roll, 2016 - 12.6%
1/2 oz AGE, random date, single coin - 7.5%
1/2 oz AGE, Mint Direct Roll, 2016 - 8.5%
$100 Face 90% Dimes or Quarters - 12.2%
1 oz. Silver Maples, random date - 12.3%
1 oz. ASE, random date - 23.4%
500 oz Green Monster Box, ASEs - 17.5%
5 oz ATB, random date, single coin - 15.8%
5 oz ATB, Mint Direct Roll - 18.1%
It's been awhile since I've gone shopping for silver, but compared to historical premiums, these premiums are very high. The gold premiums are fairly close to what I know as historical norms.
Are we expecting a silver shortage, or is there one already?
Or, are dealers buried in old inventory bought at higher prices? That wouldn't explain why gold premiums are fairly close to normal.
Just wondering out loud.
I knew it would happen.
Premiums for the real stuff will continue to rise as prices for the paper stuff continue to fall. It's the only way sellers of the real stuff can cut their losses.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
You can do better than the 17.5% APMEX premium for MBs of 2016 ASES.
You can do better than the 17.5% APMEX premium for MBs of 2016 ASES.
No doubt that's true, but if I update this market snapshot from time to time, it becomes more relevant if I hold the pricing source constant. Apmex is also more likely to maintain their pricing model constant since they are a primary Mint distributor.
So, let me ask you - what do you think is going on with silver?
I knew it would happen.
__So, let me ask you - what do you think is going on with silver?
Dealers are buried in it and don't want to let it go at what it's worth, so they sit on it. Some even make up fake news stories to explain why silver should be worth a lot more but is being superseded by "them".
Sarcasm aside, the truth is in my first sentence.
Knowledge is the enemy of fear
As i stated above, "premiums for the real stuff will continue to rise as prices for the paper stuff continue to fall. It's the only way sellers of the real stuff can cut their losses."
As long as buyers pay these higher premiums it is selling "for what it's worth." Worth is determined by the buyer, not the seller. There has always been, and will continue to be two prices for PMs - the paper price and the physical price. While physical price uses paper price as its basis a continually rising differential between the two is the result of where confidence in the two stands.
Rising premiums also reflect a growing loss of confidence in the paper and/or a rising confidence in the physical. Market prices are based on confidence and confidence is rooted in perception.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
>
TBH, I have no idea what's going on with silver. With low prices it doesn't seem to be moving which suggests poor demand. Cohodk is probably right that dealers are stuck with higher priced stuff, but I have not checked with any to find out. Have not bought much myself lately except for a few bars. Places that used to have lots of ads for the stuff are way down and hardly anyone looking for or selling ASEs. Maybe folks are saving their $$$ for the 2017s.
Also in checking APMEX's site they don't have a buy price posted for the 2016 ASEs which signals to me that they got plenty. I do see that another AP is paying $1.90 over for sealed boxes of same.
Money is working elsewhere other than silver/PMs currently. 20k Dow is proving that I'd say.
That being said, I gladly paid silly premium yesterday for some 1/2 and 3/4 oz stuff to give out for xmas - hello ~$26 silver. Free shipping helped balanced it out a little bit for the variety stuff I was wanting, even in the smallish quantity I ordered (moreso probably).
Last year was about the same spot unless you caught the quick sub 15 dip. I grabbed some then, not much, and would grab some for personal pirate chesting this year as well if/when it drops a tick more and I'm sub or around spot+2 for the stuff I would get.
ASE sales are down nearly 10 million coins from last year. That's a 20% decline.
Knowledge is the enemy of fear
For the greater part of the last 10 years silver has been roughly where it is today. With the exception of a 2 year period---where most folks are buried--no stackers have made any money, save for a few nimble folks in this board.
Folks are tired of the head fakes and false promises. They are tired of the hype and hyperbole. They've watched stocks double, home prices come back and they look at their silver orbs and question themselves. They don't want any more. They've had enough.
We have to wait for the next generation of idealists and sorry to say, ignorant, to share the fear and anxiety and greed that we did. Until then, the commodity bear super cycle lumbers along.
Knowledge is the enemy of fear
>
This reminds me of the paper the blind guy wrote when he had to describe an elephant, being only allowed to touch his tail...
. . . and some lack the ability to comprehend even the basics. lol.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Yea all the dealers at the shows told me their premiums were high because loss of confidence in paper and confidence in metals,
lol, I saw a lot of people screaming how they couldn't buy any gas or food with that paper stuff, crazy, all the people running around coin shows screaming, funny thing though was those dealers with high premiums packed all their confidence in metals back up into their cars again for the next weekend to find out if confidence is up down or sideways...
Obviously those dealers are confident in their price. Wonder why?
basic stuff, study up.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
I buy and sell. I'm not buried in it. LOL. Just to dispel "rumors".
@TwoSides2aCoin said:
What premium do you charge? Ballpark.
Knowledge is the enemy of fear
No one has any money.
I don't know maybe ask them today, lol...
Amazing your still drinking your own kool-aid...
"Premiums" depend on many things, including how nice the pieces of metal are to look at, and how motivated are the buyers and sellers at the time of the transaction. Sellers can sometimes motivate buyers by being persuasive with the quality of the goods and the sales pitch, however, buyers can rarely if ever motivate retail sellers to lower their prices.
Liberty: Parent of Science & Industry
Still, why are silver premiums higher than historic silver premiums while gold premiums seem to be about what they've always been? Have the fundamentals changed for one, but not the other?
I knew it would happen.
Volatility determines premium. Silver is more volatile.
Knowledge is the enemy of fear
Silver is more volatile than gold, but it has nothing to do with premiums. Volatility of silver prices has remained mostly constant over the years, yet premiums have steadily increased. The biggest factor to silver premiums is seller's net. If he bought at a higher spot price he is going to ask more premium to cut his losses. At $47 silver premiums were lower because the sellers' net without it was much higher.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
All your statements are quite general, don't serve us up wiz and call it champagne...
Years? How many? Premiums haven't increased at all for all intensive purposes 10-15 years ago to buy was spot plus .50 - 1 for generic its same now many times less than .50, it's same for 100oz bars...
Volatility constant??? Who you trying to kid?
Moves like yesterday were unheard of decades ago, penny moves the norm for decades ...
and who is seller? Who is he? Joe Schmoe ??? Asking for premium is meaningless kinda like home equity until you sell and pocket, when a couple large retail bullion retailers go bust that's when bottom may be in...
Decades ago is. . . decades ago.
Asking for premium is one thing. Buyers are paying higher premiums. Do your homework before you come to class. At lease your mentor reads the Cliff Notes.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
ASEs had a $3-4 premium last year. What is the premium now? Its the same. Any changes in premium are HIGHLY, dependant on volatility. There may be some seasonality effect on collector stuff, especially around the religous holiday, but haven't researched that.
Knowledge is the enemy of fear
lol, you should run for political office, always skirting the questions, never can answer...
Decades, yes, elementary except to you...
Maybe you just don't like the answers. lol.
I'm sure you can find what you want to hear if you look harder.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey